Are our city’s anchor institutions a revenue drag?

By now you all know that the city’s property tax assessment system is in flux. And While the city anticipates that the move to actual-value assessments will generate $90 million more in revenue, some of the city’s wealthiest landowners still aren’t paying one red cent.

Who are these deadbeats? Some of our city’s finest nonprofit institutions like Penn, Drexel, HUP, and Jefferson. As nonprofits they don’t pay taxes, and in recent years they also stopped making payments-in-lieu-of-taxes (PILOTs) to the city because of state legislation that softened the threat of losing nonprofit status due to nonpayment.

City Paper’s Daniel Denvir breaks down the extent of Philly’s PILOT problem in a recent piece, explaining: Philadelphia has more tax-exempt land (by value) than any other major city in the United States―an estimated 10.8 percent in 2006.

The city gave me the latest numbers: land in the city of Philadelphia is worth about $56,258,370,844. Of that, $13,237,113,300 belongs to tax-exempt institutions, and a minimum of (they say this is a conservative estimate because not all university and hospital properties are included) $3,622,362,900 belongs to universities and hospitals that could pay PILOTs―6.4 percent of the total market value of city land. Taxed at current rates, these universities and hospitals would pay at least $106,713,620―or more than enough to cover the $90 million extra you and my landlord will be paying. Sure Philly’s eds and meds are important anchor institutions, Denvir acknowledges, but shouldn’t they do better by the city they’re in? Why is there’s so little political will to ask these anchor nonprofits to pony up (something, anything) instead of being dead weight on the property tax rolls?

The Daily News picked up the baton this week with a simliar piece on the city’s PILOT problem. Alongside it, an It’s Our Money column explained how some for-profit businesses actually make PILOT payments even though they don’t have to.